Macro Alert:
Australia is seeing significant slow-down. This mornings Manufacturing report was the "warning signal" we have been looking for to short AUD.USD
(Link: https://mninews.marketnews.com/content/rpt-australia-april-mfg-contracts-lowest-may-2009)
We have Bought a 1.0100 July AUD put USD call for 80 pips or 800 USD per 100.000 AUD exposure - Expiry July 13.
I will submit a big report including country analysis but the main points are:
1. Australia benefit from the Super Cycle in commodities is petering out in 2013 - where mining investment to GDP will peak at 8% - This concept is supported by even the RBA
2. There is significant reductions in pipeline projects due to both lower general level of commodity prices which have meant cancellations.
3. The non-mining economy is weaker and getting weaker
4. China slow-down
Full report tonight or tomorrow morning
Chart 1: AUDUSD and 6x0 FRA's - which is about to go recent lows. Note the strong historic correlation!
Chart 2: Australian pipeline for investment – market, RBA, IMF and I saying: 2013 peak – (It's already happened)
Med venlig hilsen | Best regards
Steen Jakobsen | Chief Economist
Saxo Bank A/S | Philip Heymans Allé 15 | DK-2900 Hellerup
Phone: +45 39 77 40 00 | Direct: +45 39 77 62 23 | Mobile: +45 51 54 50 00
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